10th Nov 2014 07:57
LONDON (Alliance News) - Redrow PLC Monday became the latest housebuilder to say that the UK housing market has returned to a more normal seasonal pattern after its recent boom and price rises have moderated, as it also cautioned that planning permissions were being hampered by political posturing ahead of next year's general election.
In a statement ahead of the company's annual general meeting Chairman Steve Morgan said Redrow's sales rate per outlet per week for its regional businesses is 0.65, compared with the "abnormally high rate" of 0.87 in the summer of 2013.
"During the last ten weeks we have experienced a traditional autumn market and the sales rate, excluding London, was 0.68, in line with last year," he said.
Morgan said the company's London developments on release are almost fully sold out and, due to the timing of the launch of new developments, year-to-date private reservations are 22 compared with 86 last year.
Its private order book is up 10% year-on-year in total at GBP465 million, with the regional order book up 25%, the Chairman said.
Cancellation rates remain at historically low levels, while the company's average selling price of private reservations in the year to date is 4% ahead of the same period last year at GBP284,000, due to both geographical mix and limited house price inflation.
Redrow has added 1,500 plots across 14 sites to its current land bank, 520 of which were converted from forward land. Its total current land bank has increased to 16,914 plots.
"Whilst the planning system at a strategic level has improved over recent years, obtaining detailed consents and clearing countless unnecessary conditions remains a significant constraint on new outlet openings and growth. In addition, political posturing ahead of next year's General Election is already having a detrimental impact on the time taken to grant planning permissions in many parts of the country," the company warned.
Morgan said Redrow's net debt has fallen to about GBP120 million, from GBP173 million in June, due to the phasing of land purchases and legal completions, but it expects net debt to be about GBP150 million at the end of December.
The company will put out its half-year results on February 11.
By Steve McGrath; [email protected]; @stevemcgrath1
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